UAE growth to moderate but remains well supported

UAE growth to moderate but remains well supported

The UAE's economic growth in 2023 will moderate from last year’s very strong levels, but remains fundamentally well supported by the country’s high quality infrastructure and the government’s persistent reform drive, says an NBK report.

Dubai’s property market is once again booming amid strong economic growth, rising migration, tourism and overseas demand, though by next year the rally may run out of steam, says the bank's Macroeconomic outlook 2023-24.

Downside risks include a weaker-then-expected global economy, tighter financial conditions and a downturn in the property market. Upside risks include higher-than-expected oil prices and improved regional diplomatic ties that boost trade.

Non-oil growth to moderate after 2022 surge

The UAE’s robust post-pandemic economic recovery will soften this year on oil production cuts, slightly lower oil prices, tighter financial conditions, a slowing global economy and the fading boosts from both pandemic-era pent-up demand and the Dubai Expo.

Still, the country’s competitive edge in the region, as well as progressive, pro-growth reforms under the 2050 Strategy and 2031 vision will continue to support fundamentals, while the authorities invest heavily in oil and gas output but also facilitate the energy transition (with a net-zero emissions target of 2050).

Oil GDP will however barely increase overall in 2023-24, in line with